763.72113/1054: Telegram

The Acting Secretary of State to the Minister in Honduras (Jones)

Your June 26, 6 p.m.

Has Supreme Court rendered a decision in regard to alien property law? What has the Government of Honduras decided to do in connection with the carrying out of subsection B of Section 4, Article 297 of the Treaty of Peace with Germany signed by the Honduran delegate in Paris, which provides that the allied and associated powers reserve the right to retain and liquidate all [Page 406] property, rights and interests belonging at the date of the coming into force of the present treaty to German nationals, or companies controlled by them, within their territories, colonies, possessions, protectorates, etc.?

Strictly confidential. The Government of the United States, on account of the strategic and economic position of Fonseca Bay, would naturally view with more than considerable apprehension the return to German nationals of German holdings at Amapala. In your opinion would the Government of Honduras be in a financial position to carry out a liquidation of all such German property. Please cable Department approximate value of all German holdings Fonseca Bay. Is there in your opinion any American concern in Honduras which would be capable of furnishing necessary funds for liquidation and purchase German holdings?